Poul Thomsen, head of International Monetary Fund's mission to Greece, speaks on a economic forum in Athens, Greece, on April 15, 2013. Greece has reached an agreement with international lenders on the terms of the release of further bailout aid to the country in May, Greek Finance Minister Yannis Stournaras said on Monday during an economic forum in Athens. (Xinhua/Marios Lolos)
Greece has reached an agreement with international lenders on the terms of the release of further bailout aid to the country in May, Greek Finance Minister Yannis Stournaras said on Monday during an economic forum in Athens.
"We have a deal with troika," he announced, addressing the event.
Within minutes, Poul Thomsen, head of International Monetary Fund's mission to Greece, who was also among key speakers, confirmed the positive result which comes after marathon negotiations between the two sides this spring.
Stournaras is due to hold a meeting with envoys of international creditors to Athens, including Thomsen, later on Monday to finalize some aspects, before the unveiling of the full deal in coming hours.
In the meantime, the troika issued a statement on the conclusion of the latest review of the Greek austerity and reform program.
"Staff teams from the European Commission (EC), European Central Bank (ECB), and International Monetary Fund (IMF) have concluded their review mission to Greece. The mission has reached staff-level agreement with the authorities on the economic and financial policies needed to ensure the program remains on track to achieve its objectives," said the statement.
The deal on the next package of measures, in particular structural reforms needed to be implemented in coming months, paves the road for the disbursement of the delayed 2.8 billion euro March tranche, the next 6 billion euro worth installment and an additional extra 7.2 billion euros for the recapitalization of Greece's banking sector in coming weeks.
According to statements of Greek government officials over the weekend, the agreement foresees the dismissal of some 4,000 public servants by 2014 and an extra 10,000 by 2015, starting with those close to retirement age and indicted for breach of code of conduct.
The overhaul of the civil sector has been a long-standing thorny issue on the agenda due to concerns over the possible impact on already record high unemployment and recession.
Both Stournaras and Thomsen stressed that despite difficulties, Greece has come a long way from the brink of chaotic default by implementing a bold austerity and reform program under bailout deals clinched since 2010.
However, the country still has to boost efficiency in sectors, such as addressing wide-spread tax evasion and a competitiveness shortfall through the liberalization of markets and professions, the administrative reform and the privatization of state-owned assets. The same points have been highlighted in the statement on the troika auditors' review.
Via this path, deficit-cutting goals could be met with no further cuts on wages, pages and tax hikes on the shoulders of low and middle- income taxpayers which have created a sense of unfairness, Thomsen stressed.
Both officials expressed optimism that there is light at the end of the tunnel. Praising the fiscal adjustment in Greece over the past three years as "exceptional", Thomsen said that a gradual recovery is expected from next year, as noted in the joint statement by troika on Monday.
Stournaras said that Greece "are regaining trust at rapid pace" and the "prophets of doom" was "proved to be wrong," adding that "our main target today is a primary surplus in 2013, so that we could request a further debt reduction in the future."
In regards to the stability of the Greek banking system which has been affected by the sovereign debt crisis, and is currently under a recapitalization process with the aid of lenders, they reassured that all deposits in Greece's banks are safe on the aftermath of the Cyprus banking crisis.
